“The market is going down because corporate profits will begin to disappoint, the global economy will hardly grow next year or even contract, and that is the reason why stocks, from the highs of September of 1,470 on the S&P, will drop at least 20 percent, in my view."

The S&P 500 broad stock index is currently trading at 1,380.

At the end of this year, tax cuts are scheduled to expire at the same time automatic cuts to government spending kick in, a combination known as a fiscal cliff that could send the country falling into a recession next year if left unchecked by Congress.

Meanwhile in Greece, the country has pushed through austerity measures and has even approved a new budget for next year, both requirements for Athens to tap bailout tranches.

Eurozone finance ministers, however, have yet to disburse Greece's next shot of rescue funding as they review the fine details of the country's commitment to austerity, which has global markets on edge.

Bailout problems will tackle short-term solvency issues for Greece, but the country and its European and multilateral creditors have yet to agree on ways to lower longer-term debt burdens.

Still, in the near term, a sell-off stemming from weak earnings will continue to run its course, as policymakers can punt tough decisions when it comes to the fiscal cliff even if it comes to extending tax and spending deadlines.

“There will be pain and there will be very substantial pain. The question is do we take less pain now through austerity or risk a complete collapse of society in five to 10 years’ time?” Faber said.

“In a democracy, they’re not going to take the pain, they’re going to kick down the problems and they’re going to get bigger and bigger.”

Other market experts point out that investors will remain in an anxious wait-and-see mode when it comes to the fiscal cliff.

"Stocks will be stuck where they are until we get some kind of resolution on this, and if we don't get something done, people will be even more disenchanted with equities than they are now," said Art Hogan, managing director of Lazard Capital Markets in New York, according to Reuters.